Posted by : Sainadh Reddy Friday, 24 August 2012

Higher education needs supply management
To meet the pulls on the demand side, a planned and progressive growth needs to be made in the supply side.
In India, public sector investment in education is four per cent of the Gross Domestic Product (GDP) and less than 0.6 per cent of GDP that goes to higher education. The government has pledged to raise public spending on education to six per cent of GDP and the funds requirement for expansion of higher education will be around Rs 60,000 crore in 2009-10, going up to Rs 1,55,000 crore by 2016-17. Even at such investment levels, the UNESCO puts India amongst the lowest spenders on education per student in the world.
The current Gross Enrolment Rate (GER) of higher education in India is roughly six per cent. The policy document envisages setting up 16 new Central Universities (CU), five engineering and medical colleges in the new CUs, 14 World Class Central Universities (WCCU), five medical and engineering colleges in the WCCUs, besides other incentives and support. In the technical education front, the Eleventh Plan provides an outlay for eight new IITs, 20 new NITs, 20 new IIITs, seven new IIMs, three new IISERs, besides other research and post-graduate fellowships.
All these are not enough to increase the GER to 30 per cent by 2020 as envisaged by the Centre. There is a serious demand-supply mismatch. The projected growth in demand clearly indicates the need for new institutions to impart education in subject areas of contemporary relevance and job opportunities.
Skilled Manpower scarcity
There is scarcity of skilled manpower in every industry. The Indian banking industry is expected to add another 600,000 in the next three-four years. This is a 66 per cent jump from the current employment level of 900,000 people. Similarly, the retail industry will need 2.5 million skilled professionals by 2012. Recently, the Prime Minister called for an investment of $1 trillion (Rs 45,00,000 crore) for infrastructure growth in the Twelfth Plan. This will call for a huge requirement of qualified engineers.
Supply indigenously
The rapid pace at which the world is getting globalised, there is a need for Indian higher education to integrate its degrees with the best available in the world. This platform need not be necessarily laid by foreign universities but by capable Indian institutions of higher learning themselves. Inviting foreign universities to address the supply side will only address the symptoms leaving the disease uncured. The success rate of foreign universities in other countries is also not encouraging.
The institutions in India need massive scaling up both in terms of quantity and quality. Japan has 4,000 universities for a population of 130 million and the US has over 3,500 universities for 310 million. In sharp contrast, India has only around 400 universities for a population of 1.2 billion.
To meet the demand, planned and progressive growth in supply needs to be ensured. Unfortunately, the Indian regulatory regime tends to stunt supply rather than increase it. Investments by private education providers in India are estimated at $40 billion in 2008 and will increase to $68 billion by 2012.
Role of Government
There is an apprehension that private sector education will also invite fly-by-night operators who will open bogus universities and colleges and cheat students of their money. India needs more public-private partnerships to ensure that it does not lag behind its Asian peers, especially China which is making major reforms in its higher education policy. Private institutions will help reduce the cost of post-secondary education for governments whose role should be to set the rules for higher education within a reasonable framework, monitor compliance and administering the existing public institutions effectively.
Effective surveillance and reasonable regulation need to be brought in to encourage many private institutions and once the supply side is adequate and competition to attract talented students gains pace, the stakeholders concerned will be in a position to discern quality and will not be at the mercy of unscrupulous institutions.
Globally, market forces have stabilised tuition fees and it is only on-campus research that has separated the best from the rest. Will Indian universities also be among the best? The answer lies in the co-ordinated approach that the Union Government needs to take.
- S. Vaidhyasubramaniam

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